Maximizing leverage w/ partners

[Frank Z.]

I have a partner and wanna run a possible strategy by this group. 

Say I buy house X for $200k, get a mortgage on it for $100k, then quit claim it in an LLC and sell half of the LLC to my partner at the same valuation I paid.

Now we're 50/50 owners and I was able to take the leverage I wanted, and he was able to stay off the loan which is what he wants. Is this a viable strategy or am I going to run into legal issues? 

I understand there is a possibility the banks may call the loan due and I'm fine with that risk. Are there other legal / tax consequences beyond that?

[Andrew Postell]

@Frank Z. So, you COULD go about doing it the way you described...but where would your partner get the money from?  If you do structure it this way, I cannot get a mortgage to buy your business.  I would need a business loan...not a business/commercial mortgage - but a true loan.  And getting financing in that way is very hard.  Now, if your partner has straight cash, then ok...but there is a SIGNIFICANTLY easier way to structure what you are describing with the same results.

You and your partner create an LLC. The LLC buys the property with a mortgage in the LLC name. That way, you and your partner own the LLC and the mortgage is not in your partners name. Super easy. This is how we all acquire properties in LLC names with a loan in nobody's personal name.

Hope all of that makes sense.